City, Woda Group update municipal service agreement

Tuesday

Sep 26, 2017 at 3:00 PM

Nick Nolan

A special meeting was held Monday evening between the Sault Ste. Marie City Commission and the Woda Group to adjust language regarding the municipal service agreement for the Osborn Commons Development.

The Woda Group is aiming to put a 4,000 square foot housing project on 146 Ridge Street adjacent to Maloney Alley. The now-$12.8 million project would bring over 60 low to moderate income housing units and a handful of commercial units to the barren downtown parking lot.

The City Commission unanimously voted to change a provision in the municipal service agreement (MSA) that potentially allowed the city to exit a payment in lieu of taxes ordinance with the Woda Group. In return the commission received a “sweeping guarantee” from the developer that the MSA would be covered. The MSA could generate the city over $15,000 per year.

Previously, during a March commission meeting a payment in lieu of taxes (PILOT) ordinance was passed for the then-estimated $9 million-$11 million project. The Woda Group failed to secure a housing tax credit from the Michigan State Housing Development Authority in the spring partly due to language involving the MSA.

“Since we met last we submitted our application and received word from MSHDA that we had not made the scoring necessary to win. We missed it by three points,” said Woda Group Senior Vice President Craig Patterson.

Patterson said the group believes they’ll have a highly competitive application on Oct. 2, the next MSHDA application deadline. MSHDA informed the Woda Group that the PILOT arrangement was fine, but the MSA was costing them five points on their application.

Many city commissioners voiced their opinion that it’s not their job to stand in front of the Woda Group and their application. Results from the Oct. 2 application will be known around mid-January 2019, according to Patterson. If the group receives the tax credit they’d aim to finish the housing units before 2020.

“Our estimate is that it’ll probably be April, March, that we mobilize. That would be 2019,” estimated Patterson, noting that permit applications and the ground freezing would play factors in timelines. “Then it would take us 10-11 months to complete the building.”

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